Pinbars highlight sudden rejections of price and can signal short-term turning points. This strategy measures the length of the candle's tail relative to its body, looking for long shadows that stick out from recent price action. A moving average filter helps trade in the direction of the underlying trend.
During each candle update the system calculates upper and lower shadows and compares them to the body size. A bullish pinbar with a long lower wick may trigger a long entry if price is above the moving average. Likewise a bearish pinbar with an extended upper tail can initiate a short position in a downtrend. Stops are placed a fixed percentage from entry.
The trade is closed when an opposite pinbar appears against the open position or the protective stop is reached. Combining the pinbar logic with a trend filter improves reliability by avoiding countertrend setups.
Entry Criteria: Pinbar with long tail and small opposite shadow, confirmed by trend.
Long/Short: Both.
Exit Criteria: Opposite pinbar or stop-loss.
Stops: Yes, percentage based.
Default Values:
TailToBodyRatio = 2
OppositeTailRatio = 0.5
MAPeriod = 20
CandleType = 15 minute
StopLossPercent = 1
[*]Filters:
Category: Pattern
Direction: Both
Indicators: Candlestick, MA
Stops: Yes
Complexity: Intermediate
Timeframe: Intraday
Seasonality: No
Neural networks: No
Divergence: No
Risk level: Medium